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By STEVE TUCKEY, who has written on insurance issues for a decade for several national media outlets

BOSTON---Don't look for any creeping federalization of the workers' compensation system in the aftermath of healthcare reform passage, said one leading managed care expert.

"But it just ain't going to happen," he said.

All stakeholders will have their hands full just dealing with the ramifications of the current law without undertaking the incredible effort it would take to federalize the workers' comp system. That system in the end still comprises not even 2 percent of the overall healthcare system in the country, Paduda said.

Healthcare reform will impact workers' compensation directly in certain limited instances, such as the fact that Medicare will now take over medical costs associated with the diseases stemming from the Libby Mines in Montana, as well as black lung disease costs in several states. But the guidelines for the Department of Health and Human Services to declare such a public emergency are such that it is unlikely to happen in many other cases, Paduda added.

The fact that more people will have health insurance will indirectly benefit the workers' compensation system in that it will be less expensive to treat healthier people for injuries incurred on the job.

In addition, Paduda said, the flow of federal dollars toward comparative effectiveness studies for medical treatments will eventually be felt in the comp system, once more effective treatments are put to greater use as a result of these studies.

"Overall, we will see less of a cost-shifting of medical costs to the comp system," Paduda said.

Tom Dolan, workers' compensation senior manager for the Houston School District, extolled healthcare reform's emphasis on the use of medical networks. It will, in the end, help patients get to the best doctor capable of providing the best service as a result of new and more efficient ways of measuring doctors' effectiveness in treating sickness that are an inherent part of the network system.

The panelists also looked at various comp reform efforts in the states.

Art Wilcox, a director for the New York state AFL-CIO, said comp reform stands as about the sole major achievement of the short-lived Eliot Spitzer administration. He said it was achieved by lawmakers getting labor and employers in the room without the interference of third-party vendors pushing their own interests.

"I feel that the one thing that Spitzer realized is that we did not know how to talk to each other," he said.

While Paduda agreed that so many comp dollars were sucked out of the system by "people providing questionable or even negative value," going it alone can lead to pitfalls.

As an example, he pointed to the exodus of pharmacy benefits managers in one state where reimbursement rates proved to be too low, resulting in a situation that ultimately had to be corrected for the system to work.

Paduda said Florida is one of the greatest success stories in terms of comp reform with participation of physicians and return-to-work rates on the rise and claims frequency down.

April 29, 2010

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